[Click eStock] "DearU, Disappointing First Half Earnings... Target Price Down"

Samsung Securities analyzed on the 29th that DearU showed poor performance, including a decrease in subscriptions in the first half of the year. The investment opinion was maintained as 'Buy,' but the target price was lowered to 29,000 KRW.

Minha Choi, a researcher at Samsung Securities, said, "The number of subscriptions, a key growth indicator, stagnated for three consecutive quarters and then showed negative growth in the second quarter," adding, "The service termination of the boy group ‘ZeroBaseOne,’ military enlistment, and some artists leaving due to agency transfers had an impact." He continued, "Although the artist pool steadily expanded by broadening categories to include not only idols but also actors and dancers, one-time labor costs were added in the second quarter."

However, momentum is expected to come from the fourth quarter. He said, "It has been officially confirmed that BLACKPINK Lisa’s Bubble will be launched in September, and SM’s boy group ‘RIIZE,’ which is approaching its first anniversary, is also highly likely to join within this year," emphasizing, "Major shareholders SM and JYP have rookie girl group and rookie boy group debuts scheduled for the fourth quarter, so they may not join immediately, but it is highly likely that Bubble services will start next year."

He explained, "The establishment of a local subsidiary in the U.S. was completed last May, and the U.S. service is scheduled to launch soon," adding, "The ‘AI Pet Bubble’ service, being prepared together with AI content platform company Eyes Entertainment, as well as the artist character goods and digital item business, are also progressing with the goal of launching in the fourth quarter, which will bring additional revenue."

This content was produced with the assistance of AI translation services.